Debt is a byproduct of lacking organization. Having little to no savings (mostly) is a byproduct of having no organization with your finances. Granted, there are extreme cases where even the most organized fall to tragedy. But for most Americans, organization is the issue.

That is why I put such an emphasis on learning about your finances in Move #1.

All of this is great, but I suspect nothing is going to change if I just talk about what people are doing wrong. The real question is: How do you fix it?

That's tough because it takes a lot of courage to face your finances. It is kind of like when you get a bad cut and you don't want to dress it properly to see how bad it is. In this case, you need to look at your finances square in the face. If you don't the issues will keep multiplying.

First Thing: Start with the Good

Everyone may not be able to do this, but start with something positive. Noting your savings balance or your 401(k) may be a good place to start. Everyone is doing something right with their finances. If you are a giver, maybe you look back and say, "Wow, I haven't really made progress on my debt, but we have given a lot and helped a lot of people." This is in no way a brag, rather, it is a motivational tool. It's not as though you are patting yourself on the back and making a great proclamation to the world on how great you are. You're just noting facts.

Second Thing: Investigate Your Debt

If I were to write you a check for the total amount of your consumer (non-mortgage) debt, how much would that check be? Don't know? Then you need to mark down your debt. All of it. Due, past due, collections, it doesn't matter. Write it down. Balance, APR, Monthly Payments: Those three categories surrounding your debt are key.

Third Thing: Compose a Budget

Legitimately look at your liabilities every month and your net income. Which is higher? Where do you need to cut? Answering these questions will help you piece together a financial plan. If you're having trouble, give us a call or email. We are glad to help you walk through this.